Strata wind ups

05 March 2018


Until recently, terminating a condominium corporation required unanimous agreement (with one limited exception).  As a result, few British Columbia strata corporations wound up.  However, in 2016, the Strata Property Act[1] (the “SPA”) was amended to allow owners to wind up following an 80% majority vote, subject to court oversight.

The first test cases following the change in legislative regime are now working their way through the system.  In order to receive Court approval for such windup, the Court must determine the windup up will not cause sufficient unfairness or confusion in the affairs of owners or creditors.  So far, two notable cases have helped inform this judicial test.

In The Owners, Strata Plan VR 1966, (Re), 2017 BCSC 1661 (“Bel‑Ayre”), the BC Supreme Court declined to approve a wind‑up because the wind‑up resolution failed to include a schedule that set out the interests of each of the owners.  This schedule was required by the SPA and, according to the court, was an essential term of the liquidator’s mandate.  Bel‑Ayre confirmed that strict adherence to the requirements set out in the legislation is necessary and, as a result, any material failings on the part of owners and strata councils could cause significant and costly delays.

However, more recently in The Owners, Strata Plan VR2122 v. Wake, 2017 BCSC 2386 (“Hampstead”), the BC Supreme Court, for the first time under new legislative provisions, approved a wind‑up of a strata corporation despite the objection of dissenting owners actively opposing it in court.  In Hampstead, the court weighed heavily the ability of the Hampstead residents to realize on their property and stay in the community.  It is as of yet unclear what other factors may enter this analysis.  But, given the age of many strata developments and the property values across British Columbia, many people are watching intently.


[1] Strata Property Act, S.B.C. 1998, c. 43


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